Published: Monday, February 10, 2014 at 3:33 p.m.

Last Modified: Monday, February 10, 2014 at 7:12 p.m.

NORTH PORT - City officials won't be bidding on McCall Ranch when the massive property comes up for auction later this week, but that hasn't stopped some commissioners from fretting about the future of the tract — and its potential impact on North Port.

That's because the 5,771-acre tract on Choctaw Boulevard, once envisioned for a mix of 15,000 homes and 4.2 million square feet of retail and office space, could contain enough water to supply North Port for some time.

“Everyone thinks there's a lot of water on that property,” North Port Mayor Jim Blucher said Monday. “I was worried another government would buy up the property, and I wanted to make sure we were not behind the eight ball.”

North Port commissioners were so concerned last week that they scheduled a special meeting for Monday morning.

“The only reason I supported having this special meeting was water rights,” North Port Commissioner Cheryl Cook said. “We're only one-quarter built out in this city, and we really need to be conscious about water.”

North Port isn't the only government entity that is concerned. The Southwest Florida Water Management District considers the land a top priority.

“This property has been on the district's Florida Forever priority list for several years,” said Terri Behling, a spokeswoman for the district, commonly called Swiftmud. “The acquisition would align with our core mission of water supply, water quality and associated natural systems. The district has been in ongoing discussions with the owner for some time.”

But Swiftmud, together with North Port, face budget shortfalls that would make buying the property difficult — even if rules that make governmental land purchases at auctions difficult could be overcome.

The city has about $6 million to spend on the land, far short of the nearly $13 million in debt tied to the property.

The ranch's lender has indicated that if bids at an auction scheduled for 2 p.m. Thursday fail to meet that $13 million threshold, it will remain in its possession, North Port officials said.

After failing to draw a buyer at its $36 million asking price, the land will either be sold in nine individual tracts — each measuring about 600 acres and some lacking any access — or in its entirety.

Not that North Port could have acquired the ranch — even if it had the money.

North Port City Attorney Robert Robinson told the commission that it could not legally bid under Florida law.

“This just isn't how government typically buys property,” Robinson said.

To acquire the land, North Port would first need to obtain a pair of appraisals on the ranch, schedule public hearings for community input and formally vote on a proposed contract.

The city's inability to act leaves the door open for a private developer to buy the land and resume plans for a massive residential and retail development.

Previously, the ranch had been slated to become the Isles of Athena, but those plans crumbled when the region's real estate market deteriorated seven years ago.

Today, the owner of the ranch is seeking bankruptcy reorganization.

North Port commissioners inquired about the property fearing another government entity — like Sarasota County, with which the city has had numerous tussles over the years — would pursue buying the land for its coveted ground water supply.

But the county likely would be blocked from bidding, too, especially because North Port annexed McCall Ranch several years ago for economic development purposes.

The Isles of Athena plan, for instance, was among the most grandiose proposals to arise from Southwest Florida's real estate boom.

Developer Brian Tuttle bought the land for $61.5 million in April 2005, court records show, but when he defaulted on roughly $37 million in loans, South Florida Sod Inc. seized the property in 2009.

But South Florida Sod eventually fell into bankruptcy, burdened by as much as $50 million in liabilities, and the company has been ordered to auction the site as part of its Chapter 11 case.

The auctioneer hired by the bankruptcy trust said interest so far has been modest, especially from groups attempting to preserve the land.

At $13 million, the acquisition cost would equate to about $2,253 per acre — double the going rate for most agricultural land in Southwest Florida.

“We have been a little worried about it,” said William Bone, president of Gadsden, Ala.-based National Auction Group Inc. “We do these all across the country, and just about anywhere else in America, the environmental conservancies would be jumping and down to buy it.

“I don't know that it will be able to bring more than $13 million. At this point, we need an angel.”

The McCall Ranch property has an agricultural land-use designation, and is zoned for very low-density residential.

But before any kind of development could resume there, a new buyer would have to go through local rezoning and a comprehensive state review — known as a “development of regional impact,” which could take several years and greatly increase the cost to build.

As of 2009, as many as 2,000 acres of wetlands also needed to be mitigated on McCall Ranch, a cost that could exceed $50 million, court records show.

“There's a lot of interest, but people are realistic,” said Cliff Martinez, a commercial real estate agent in North Port. “Either you will see somebody with very deep pockets to develop it, or it just won't be sold.”

Still, demand for new homes —- and communities like the envisioned Isles of Athena — are once again picking up momentum in Southwest Florida.

Homebuilders in the region pulled permits for 3,009 single-family homes in unincorporated Sarasota and Manatee counties in 2013, a 42 percent increase over the year and the best performance since the Great Recession, county records show.

But any new development there would have to compete with North Port's thousands of residential lots that are changing hands for as little as $2,000 each, along with an inventory of existing resale homes that remains much higher than the rest of the region.

Even so, developers think the property can emerge as a successful community if the buyer is willing to think long-term and provide the right amenities.

“You have that kind of money at your disposal, you're patient and you don't plan to see your money back in at least five years, it can work out,” said Carlos Beruff, an area homebuilder who has developed successful communities in the North Port area. “It's a very large commitment.”

NOTEStart

EARLIER: City commissioners will not be buying the McCall Ranch property for ground water preservation.

North Port City Attorney Robert Robinson told the board during a special meeting Monday that they could not legally bid on the property at its scheduled bankruptcy auction this week under present Florida law.

Budget constraints also played a role: the city only has about $6 million to spend, and because there is nearly $13 million in debt tied to the land, the winning bid must be greater than those delinquent loans or the site will remain in the lien-holder's possession, Robinson said.

The city's decision reopens the door for a potential bidder to resume plans for a massive residential and retail development on the property.

“This just isn't how government typically buys property,” Robinson said. “There's a certain amount of due-diligence and transparency required for a process like this, and we just don't have the time to do that.”

The 5,771 acres of pastures on Choctaw Boulevard was once envisioned for a mix of 15,000 homes and 4.2 million square feet of retail and office space during the boom. Dubbed the Isles of Athena, those plans crumbled when Southwest Florida's real estate economy ground to a halt.

The owner of the agricultural property is now facing bankruptcy reorganization.

After failing to draw a buyer with a $36 million asking price, an auction is now scheduled for 2 p.m. on Thursday.

It will either be sold in nine individual tracts — each about 600 acres and some lacking any access — or in its entirety.

<p><em>NORTH PORT</em> - City officials won't be bidding on McCall Ranch when the massive property comes up for auction later this week, but that hasn't stopped some commissioners from fretting about the future of the tract — and its potential impact on North Port.</p><p>That's because the 5,771-acre tract on Choctaw Boulevard, once envisioned for a mix of 15,000 homes and 4.2 million square feet of retail and office space, could contain enough water to supply North Port for some time.</p><p>“Everyone thinks there's a lot of water on that property,” North Port Mayor Jim Blucher said Monday. “I was worried another government would buy up the property, and I wanted to make sure we were not behind the eight ball.”</p><p>North Port commissioners were so concerned last week that they scheduled a special meeting for Monday morning.</p><p>“The only reason I supported having this special meeting was water rights,” North Port Commissioner Cheryl Cook said. “We're only one-quarter built out in this city, and we really need to be conscious about water.”</p><p>North Port isn't the only government entity that is concerned. The Southwest Florida Water Management District considers the land a top priority.</p><p>“This property has been on the district's Florida Forever priority list for several years,” said Terri Behling, a spokeswoman for the district, commonly called Swiftmud. “The acquisition would align with our core mission of water supply, water quality and associated natural systems. The district has been in ongoing discussions with the owner for some time.”</p><p>But Swiftmud, together with North Port, face budget shortfalls that would make buying the property difficult — even if rules that make governmental land purchases at auctions difficult could be overcome.</p><p>The city has about $6 million to spend on the land, far short of the nearly $13 million in debt tied to the property.</p><p>The ranch's lender has indicated that if bids at an auction scheduled for 2 p.m. Thursday fail to meet that $13 million threshold, it will remain in its possession, North Port officials said.</p><p>After failing to draw a buyer at its $36 million asking price, the land will either be sold in nine individual tracts — each measuring about 600 acres and some lacking any access — or in its entirety.</p><p>Not that North Port could have acquired the ranch — even if it had the money.</p><p>North Port City Attorney Robert Robinson told the commission that it could not legally bid under Florida law.</p><p>“This just isn't how government typically buys property,” Robinson said. </p><p>To acquire the land, North Port would first need to obtain a pair of appraisals on the ranch, schedule public hearings for community input and formally vote on a proposed contract.</p><p>The city's inability to act leaves the door open for a private developer to buy the land and resume plans for a massive residential and retail development.</p><p>Previously, the ranch had been slated to become the Isles of Athena, but those plans crumbled when the region's real estate market deteriorated seven years ago.</p><p>Today, the owner of the ranch is seeking bankruptcy reorganization.</p><p>North Port commissioners inquired about the property fearing another government entity — like Sarasota County, with which the city has had numerous tussles over the years — would pursue buying the land for its coveted ground water supply.</p><p>But the county likely would be blocked from bidding, too, especially because North Port annexed McCall Ranch several years ago for economic development purposes.</p><p>The Isles of Athena plan, for instance, was among the most grandiose proposals to arise from Southwest Florida's real estate boom.</p><p>Developer Brian Tuttle bought the land for $61.5 million in April 2005, court records show, but when he defaulted on roughly $37 million in loans, South Florida Sod Inc. seized the property in 2009.</p><p>But South Florida Sod eventually fell into bankruptcy, burdened by as much as $50 million in liabilities, and the company has been ordered to auction the site as part of its Chapter 11 case.</p><p>The auctioneer hired by the bankruptcy trust said interest so far has been modest, especially from groups attempting to preserve the land.</p><p>At $13 million, the acquisition cost would equate to about $2,253 per acre — double the going rate for most agricultural land in Southwest Florida.</p><p>“We have been a little worried about it,” said William Bone, president of Gadsden, Ala.-based National Auction Group Inc. “We do these all across the country, and just about anywhere else in America, the environmental conservancies would be jumping and down to buy it.</p><p>“I don't know that it will be able to bring more than $13 million. At this point, we need an angel.”</p><p>The McCall Ranch property has an agricultural land-use designation, and is zoned for very low-density residential.</p><p>But before any kind of development could resume there, a new buyer would have to go through local rezoning and a comprehensive state review — known as a “development of regional impact,” which could take several years and greatly increase the cost to build.</p><p>As of 2009, as many as 2,000 acres of wetlands also needed to be mitigated on McCall Ranch, a cost that could exceed $50 million, court records show.</p><p>“There's a lot of interest, but people are realistic,” said Cliff Martinez, a commercial real estate agent in North Port. “Either you will see somebody with very deep pockets to develop it, or it just won't be sold.”</p><p>Still, demand for new homes —- and communities like the envisioned Isles of Athena — are once again picking up momentum in Southwest Florida.</p><p>Homebuilders in the region pulled permits for 3,009 single-family homes in unincorporated Sarasota and Manatee counties in 2013, a 42 percent increase over the year and the best performance since the Great Recession, county records show.</p><p>But any new development there would have to compete with North Port's thousands of residential lots that are changing hands for as little as $2,000 each, along with an inventory of existing resale homes that remains much higher than the rest of the region.</p><p>Even so, developers think the property can emerge as a successful community if the buyer is willing to think long-term and provide the right amenities.</p><p>“You have that kind of money at your disposal, you're patient and you don't plan to see your money back in at least five years, it can work out,” said Carlos Beruff, an area homebuilder who has developed successful communities in the North Port area. “It's a very large commitment.”</p><p>NOTEStart</p><p>EARLIER: City commissioners will not be buying the McCall Ranch property for ground water preservation.</p><p>North Port City Attorney Robert Robinson told the board during a special meeting Monday that they could not legally bid on the property at its scheduled bankruptcy auction this week under present Florida law.</p><p>Budget constraints also played a role: the city only has about $6 million to spend, and because there is nearly $13 million in debt tied to the land, the winning bid must be greater than those delinquent loans or the site will remain in the lien-holder's possession, Robinson said.</p><p>The city's decision reopens the door for a potential bidder to resume plans for a massive residential and retail development on the property.</p><p>“This just isn't how government typically buys property,” Robinson said. “There's a certain amount of due-diligence and transparency required for a process like this, and we just don't have the time to do that.”</p><p>The 5,771 acres of pastures on Choctaw Boulevard was once envisioned for a mix of 15,000 homes and 4.2 million square feet of retail and office space during the boom. Dubbed the Isles of Athena, those plans crumbled when Southwest Florida's real estate economy ground to a halt.</p><p>The owner of the agricultural property is now facing bankruptcy reorganization.</p><p>After failing to draw a buyer with a $36 million asking price, an auction is now scheduled for 2 p.m. on Thursday.</p><p>It will either be sold in nine individual tracts — each about 600 acres and some lacking any access — or in its entirety.</p>